House Financial Services Committee Chairman Patrick McHenry accused SEC Chairman Gary Gensler of misleading Congress regarding Ethereum's classification during testimony in April 2023.
The accusations come as tensions over regulatory approaches to digital assets have escalated in recent months, with some industry players filing lawsuits against watchdogs for overstepping their mandate.
“Arbitrary and capricious”
in statement In a document released on April 30, McHenry cited recent court documents suggesting that Gensler intentionally avoided questions from the commission regarding whether the SEC considers ETH to be a security. emphasized.
This allegation raises concerns about the SEC's transparency and consistency, especially since it contradicts previous statements by the SEC and Mr. Gensler.
Mr. McHenry said:
“Chairman Gensler refused to answer direct questions about the status of Ether, but we now know that was part of a deliberate strategy to misrepresent the SEC's position. This controversy , stemming from Gensler's response to a question during an April committee session when he was asked to clarify the SEC's stance on digital currencies, specifically Ether.
The Financial Services Committee believes this episode is indicative of a broader pattern of “arbitrary and capricious” regulatory enforcement by the SEC under Gensler's leadership.
McHenry said the watchdog's coercive approach stifles innovation and leaves American consumers unprotected. It also poses a risk to national security.
The classification of digital assets like Ethereum has significant implications for the cryptocurrency industry, impacting everything from investor protection to the regulatory responsibilities of various government agencies.
Historically, the SEC has not classified Ethereum as a security, which is consistent with industry-wide expectations for looser regulation. However, recent documents revealed that regulators have been internally considering ETH as a security since the beginning of 2018.
clear framework
The committee is advocating for passage of the bipartisan 21st Century FIT Act, which aims to establish a clear regulatory framework for digital asset markets and provide strong consumer protections.
The SEC has not yet responded to the claims made in McHenry's statement. However, these developments are likely to foster continued debate around digital asset regulation and the role of government oversight in fostering innovation while ensuring market stability and consumer protection.
This controversy comes on the heels of a recent federal court decision that sanctioned an SEC enforcement attorney for misleading the court, further threatening the SEC's credibility and operational integrity under its current leadership. casting a shadow.
Chairman McHenry and other Republicans on the committee vowed to continue their oversight efforts to hold the SEC and Gensler accountable for what they call regulatory overreach.
